United States Steel Corp. (U.S. Steel) announced this week that it will invest approximately $60 million to insource pig iron capabilities at its Gary Works facility as part of its metallics strategy.
“U. S. Steel’s low-cost iron ore is an important strategic advantage for the company,” U.S. Steel President and CEO David B. Burritt said. “Our ability to control this important steelmaking input is a valuable competitive differentiator for our growing fleet of electric arc furnaces. An investment in pig iron is an important first step to translating our low-cost iron ore advantage to our EAF (electric arc furnaces) footprint while driving efficiencies at Gary Works.”
Gary Works will produce up to 500,000 tons of pig iron, a raw material input for its EAF, annually. This will provide nearly half of Big River Steel’s other ore-based metallics needs, contribute more than $30 million of run-rate enterprise earnings before interest, taxes, depreciation, and amortization and deliver an internal rate of return greater than 30 percent.
Insourcing pig iron is expected to drive blast furnace efficiencies without reducing Gary Works’ raw steel output.
Construction is expected to begin during the first half of the year, with production expected to begin during the first half of 2023.